Dufu dissolves its executive committee

KUALA LUMPUR: Dufu Technology Corp Bhd has dissolved its executive committee, which was suspended eight months ago following a probe into allegations of remittance of the group’s funds to customers in the US and unbilled delivery orders.

The maker of precision steel moulds and machining components told Bursa Malaysia on Wednesday that the power/authority to review, deliberate and approve the purchase or disposal of the group’s investments or assets would now be assumed by Dufu’s investment committee.

The investment committee, formed on Aug 26, 2014, comprises chairman Ong Choon Heng as well as Ang Siak Keng and Lee Hui-Ta @ Li Hui Ta (who had been one of the members of the executive committee formed in May 2007 to assist the chief executive officer in running the day-to-day operations).

On June 22 last year the company had suspended the power/authority vested on its executive committee pending the issuance of the investigation report by Ferrier Hodgson MH Sdn Bhd. The board then assumed its power/authority.

The board received the said report on July 7. The report noted that US$1.01mil (RM4.28mil) was remitted in 2013 and 2014 from two of Dufu’s subsidiaries to a company incorporated under the US laws authorised by key senior management members, one of whom is also in the senior management of the US company.

Also, in 2012 and 2013, Dufu’s subsidiaries issued a total of 67 delivery orders to a company related to a former director, who was still a Dufu director when these transactions occurred. Despite the provision of services to that company, Dufu did not issue any invoices for payment totalling RM543,781.

On Aug 27 the company entered into a settlement agreement with its former chief executive officer Yong Poh Yow (who resigned on the same day) to recover the sum of US$0.66mil (RM2.8mil), being the balance sum remitted to the US after the refund of US$0.35mil from him.

Dufu, via its solicitors, also issued notice of demand to recover the sum of RM543,7811 from the company that had received its services in 2012 and 2013.

On Sept 8, Yong was rehired by Dufu as an independent consultant. Dufu signed a six-month agreement appointing Aspire Ambience Sdn Bhd, whose directors were Yong and his wife, to train and guide the acting CEO in overseeing the operations of Dufu’s unit Dufu Industries Sdn Bhd for a monthly fee of RM40,000. 

Dufu shares fell 1.5 sen to close at 56 sen on Wednesday, with 7.504 million shares done.